Chronic insomnia is a prevalent disorder associated with increased health care costs, impaired functioning, and an increased risk for developing serious psychiatric disorders. Cognitive Behavioral Therapy (CBT) and benzodiazepine receptor agonist (BzRA) medications are the most widely supported approaches for insomnia management. Unfortunately, few studies have compared CBT and BzRA medications for insomnia treatment. Previous insomnia treatment studies also have been limited by small, highly screened study samples, fixed- dose and fixed-agent pharmacotherapy strategies that do not represent usual adjustable dosing practices, relatively short follow-up intervals, and reliance on self-reported or polysomnographically (PSG) assessed sleep parameters as outcomes, rather than on insomnia remission indicators that are more relevant to clinical practice. Finally, studies have yet to test the benefits of various treatment-sequencing strategies for those who do not respond to initial their insomnia therapies. This dual-site project will address these limitations. The two study sites will enroll a total of 320 participants who meet broad criteria for chronic insomnia disorder. Participants will be evaluated with clinical assessments and PSG, then randomly assigned to first-stage therapy with CBT or zolpidem (most widely-prescribed BzRA). Centrally trained therapists will administer CBT and zolpidem according to manualized, albeit flexible, treatment algorithms. Initial outcomes will be assessed after 6 weeks, and treatment remitters will be followed for the next 12 months on maintenance therapy. Those who fail to achieve insomnia remission with first-line therapy will be encouraged to accept random assignment to a second, 6-week, medication (zolpidem or trazodone) or behavioral (standard or tailored CBT) treatment. All participants will be re-evaluated 12 weeks after protocol initiation, and at 3-, 6-, 9-, and 12-month follow-ups while continuing their final treatment. Insomnia remission, defined categorically as a score < 8 on the Insomnia Severity Index, will serve as the primary outcome for treatment comparisons. Secondary outcomes will include sleep diary and PSG sleep measures; subjective ratings of sleep and daytime function; adverse events; dropout rates; and treatment acceptability. Study Aims include: (1) comparing the efficacy of CBT and Zolpidem for producing sustained insomnia remission when used as first line therapies; (2) comparing the efficacy of treatment switching and augmentation strategies for those who fail to remit with first line treatments; (3) comparing the responses of those with and without psychiatric comorbities to first and second line treatments; and (4) exploring the usefulness of selected biomarkers and trait measures as predictors of treatment outcomes. Our over-arching goal is to obtain new information that contributes to the development of clinical guidelines for PI and CMI management.